The Process of Negotiation

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On many occasions I have been asked how do we drive the negotiation meeting.

Here is a simple five-step Negotiation Process that can be applied for successful results in all your negotiating sessions:


Step 1: Analyse the Negotiation Situation

Start by collating all the information relevant to the situation under negotiation. You could apply the Johari Window concept and the data collated could be divided into useful sections. The Johari Window divides the information into four quadrants:

  1. Known to me and Known to the other person
  2. Known to me but Unknown to the other person
  3. Known to other person but Unknown to me
  4. Unknown to both parties

Applying this to the data you’ve collected can give you critical insights into the other party’s view of the negotiation, and also have you alert for information that you may not have and would like to seek.


Step 2: Develop the Negotiation Framework

The Negotiation Framework in business occurs within the state / country laws of the negotiating parties and within the socially accepted rules of corporate governance. Further, a framework for each negotiation must be outlined, understood and adhered to by all parties. It’s also important to decide what you will do if any of the agreed rules are broken. This gives you the critical ability to redirect the negotiation if it drifts to areas that are irrelevant to the negotiation subject.


Step 3: Develop Your BATNA

Your BATNA is your “Best Alternative To a Negotiated Agreement”.

What happens if you can’t reach an agreement. Determining your BATNA before the negotiation begins, is necessary, because it provides you with a measurement index against which you can compare offers made. To determine your BATNA, first list all your alternatives, identify those that can be expanded into practical and attainable ones, then pick out the very best alternative and keep that as your backup position. The stronger your BATNA assessment is, the more powerful you’ll feel when negotiating.


Step 4: Select Your Negotiating Approach

The negotiating style you use will affect the outcome you will get. If you want to build a long-term relationship with your negotiating partner, then you’ll want to make a deal that both of you are happy with (The Win-Win Negotiation Approach). In that scenario, you’ll want to use a problem-solving, collaborative approach. On the other hand, if you want the best deal for yourself and aren’t worried about your negotiating partner getting any payback (i.e., if you’re not interested in a long-term relationship, The Win-Lose Approach) then you can use an aggressive approach.


Step 5: Specify the Optimum Negotiating Environment

Working through the steps above allows you to develop a clear idea of what physical and psychological elements are required to create the best possible environment in which to negotiate.

For example, your negotiating style can determine the seating arrangements and table style for the room. Don’t ignore your physiological elements: you’ll want to arrange your schedule (including any travel) to ensure you will be well rested and alert. Learning to negotiate successfully requires time and practice, with each negotiation providing an opportunity to enhance your knowledge and develop your skill. However, using this five-step Negotiation Process Model can provide you with a solid foundation upon which to build a winning strategy.